Why Values-Based Businesses Thrive

Get More Done, Have a Better Time Doing It, and Attract the Right People

If you're a small business owner, you've undoubtedly come across core values and may have included them in your business plan. You might have even heard about “values-based businesses”. As a business coach, I know how impactful strategically embedded values can be, but I often come up against resistance when I suggest we bring them to the forefront. With competing priorities, small business owners usually question the return on any time, energy or financial investment in working more deeply with their values. This blog discusses why values-based businesses thrive and why embedding them is crucial if you want to grow.

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Do any of the following statements sound true for you?

• Your organisation has values, but there are cultural challenges, performance issues, and people working by their own rules.
• Your organisation doesn’t have values. You’ve heard of the benefits, but creating them seems like a minefield, and you’re unsure how to engage your team.
• You think creating organisational values is just “fluff” and a waste of time that could be used to make more money.
• You’ve got values. Some words are in your business plan, and you don’t see the point in doing anything else with them.

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Well, I’ve got you covered. My goal is that by the end of this blog, you’ll be almost as passionate about values as I am and ready to take your business to the next level, using powerful values as a foundation for your growth.

The Benefits of Organisational Values

Think of core values as the guiding principles that define what's truly important in your organisation. They set a foundation for what’s acceptable and what’s not, creating clear expectations for everyone and underpinning the culture you want to foster in the business.

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The World Economic Forum found that almost 40% of 25,000 people aged between 18 and 35 in the Global Shapers Annual Survey 2017 think having a sense of “purpose/impact” is one of the most important criteria when looking at career opportunities. 

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But what’s the best reason?

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At the end of the day, embedding organisational values (in the right way) saves you time and money. FULL STOP.

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When you and your team are aligned, you’ll spend less time attracting, retaining, and managing the wrong team members and more time doing cool business.

The Tangible Benefits of a Values-Based Approach

Customer Loyalty and Trust: A 2023 study by Edelman revealed that 63% of consumers buy or advocate for brands based on their beliefs and values. Customers gravitate towards businesses that reflect their own values, fostering deep loyalty and trust.

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Employee Engagement and Retention: Gallup's 2022 report highlighted that companies with strong values see a 24% higher employee engagement. Employees who resonate with the company’s values are more motivated, productive, and loyal.

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Brand Differentiation: Your values can set you apart in a saturated market. A unique value proposition rooted in strong principles attracts like-minded customers and builds a distinct brand identity. I love Zappos for this! 

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‍Long-Term Success: Values-based businesses often enjoy long-term stability. A Deloitte survey from 2022 indicated that businesses prioritising values reported a 30% higher growth rate compared to those that didn't.

A Story to Illustrate

Let me tell you a story about Sally, a new team member at ABC Widgets. The organisation had values, but they weren’t embedded into everyday business practices.

Common Traps and How to Avoid Them

“We have values!” (But we don’t actually care about them…)

You’re the owner of ABC Widgets, and many years ago, you defined your organisational values as “Integrity”, “Trust”, “Teamwork” and “Customer Service”. They’re stuck on the wall in the kitchen, but neither you nor your team can recall them, and they are never talked about. People scoff when they hear about values.

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How to do it better: Values should never just sit on the wall. They MUST become a living and breathing part of everything you do in your organisation. From hiring to firing, from marketing to supplier engagement. Otherwise, your business values are just another ‘tick of the box’. But for what purpose did you create them in the first place?

“It’s all about teamwork!” (But we don’t hold anyone accountable…)

You overhear Sally asking Phil for help with something. Phil says, “Yeah, look sorry… It's 4.50, and I need to pack up. I only work until 5”. He leaves, and Sally is unable to proceed with her task. You stay in your office and say nothing because Phil has always been a stickler for finishing at 5, and he refuses to change.

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How to do it better: If teamwork is one of your values as a business leader, this is the perfect time to reinforce what “teamwork”  means. It doesn’t mean running away from a team member who is looking for support and guidance.

“We say customer service is important…but…” (So we say one thing and do another)

Sally overhears Bill complaining to another colleague about how you (the owner) refused to refund a customer who had to wait a long time for an order that eventually arrived damaged. Your philosophy is: “It’s not my fault because the parcel left here just fine.”

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How to do it better: If customer service is important… make it essential! Re-ship that product and provide compensation to rebuild trust and ensure the customer becomes a raving van. Check out this superb example of how Zappos lives its values of wowing customers and being fun and a little weird.

“We trust our team to do a good job.” (But we don’t manage behaviours, so we don’t trust them at all)

Sally reports to John, who constantly interrupts and micromanages her despite her expertise. It’s not the first complaint you’ve received about John’s management style, but you're hesitant to address it. John is a valuable asset, and you fear that confronting him might lead to losing him. Besides, that’s just the way he is…

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How to do it better: John’s micromanagement and interruptions stem from a lack of trust in his team, and perhaps in himself. As the leader of your business, it’s your responsibility to mentor, coach, and guide your team towards greater performance and excellence. Consider approaching John with something like:

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“John, I’ve noticed that you’re not giving Sally the space to fully embrace her role, which suggests a lack of trust. Trust is one of our core values; we live it by seeing failure as an opportunity to learn. Help me understand what’s going on and how we can work together to embody this value.”

“It was all for naught.” (We’re not learning from our mistakes)

After a month of training, inductions, and onboarding, Sally resigns. In her exit interview, she tells you she was disappointed. She thought the values in the kitchen would have meant something, but:

• She didn’t see the customer service priority.
• She didn’t feel the organisation trusted the team to do their jobs well.
• She felt that the team failed to step up to assist her.
• Overall, she believed the company didn’t value its values, which did not align with the workplace she wanted to work in.

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How to do it better: Reflect and learn! Consider the actual and time cost of recruiting and losing a potentially great team member. Take those values and start embedding them in the organisation. Develop behaviours that make it very clear how to live them and hold your team accountable.

Implementing a Values-Based Strategy

Step 1: Define Your Core Values: 

Identify what truly matters to your business. These principles should align with your mission, inspire your team and attract your ideal team members and customers. Crucially, define the specific behaviours that exemplify each value. This provides clear, actionable guidelines for your team to follow and ensures everyone understands how to live the values daily.

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Step 2: Involve Your Team: 

Engage your team in the process of creating values and defining associated behaviours. Involvement fosters ownership and commitment. When team members contribute to determining what each value means in practice, they are more likely to hold themselves and each other accountable for living them.

Step 3: Communicate Clearly and Consistently: 

Your values should be seen and experienced. From how you manage your team to running your meetings, from performance review processes to your website, from social media and sales proposals to customer delivery. Consistent messaging and aligned actions help reinforce your values. Use stories and examples to illustrate how these values are lived in your organisation, making them relatable and tangible.

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Step 4: Walk the Talk: 

This means integrating them into your operations, customer interactions, and company policies. Most importantly, the leadership must walk the talk for them to be congruent with the expectations for your team. Include values in performance reviews and management practices. Recognise and reward behaviours that align with your values and address behaviours that do not. This integration ensures that values are not just words but are actively shaping the culture and operations of your business.

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Step 5: Measure and Reflect: 

Regularly assess how well you uphold your values and whether they are helping to achieve your goals. Solicit feedback from employees and customers to identify strengths and areas for improvement. This feedback loop helps to maintain accountability and continuous improvement. Use surveys, meetings, and informal check-ins to gather insights and adjust your strategies.

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Step 6: Remember the Importance of Accountability and Continuous Improvement

Accountability is vital to maintaining a values-based culture. Ensure that everyone, from leadership to entry-level employees, understands they are responsible for upholding the company’s values. Create a system for recognising and rewarding adherence to values and addressing deviations constructively. This approach promotes a culture of continuous improvement and reinforces the significance of values in achieving long-term success.

Current Trends Driving Values-Based Businesses

As businesses evolve, aligning with current societal and environmental trends has become more critical. These trends highlight the relevance of having strong core values and underscore the need for businesses to adapt and respond to the changing expectations of consumers and the broader community. Here are some key trends driving the success of values-based businesses:

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Sustainability: The push for environmental responsibility is more significant than ever. Consumers are increasingly prioritising sustainable brands, and businesses are responding by adopting greener practices.

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Social Responsibility: From supporting local communities to global humanitarian efforts, businesses recognise the importance of social impact. A 2023 PwC survey found that 76% of consumers expect companies to address social justice issues.

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Transparency: In an age of information, customers value transparency. Whether it’s about product sourcing, pricing, or corporate practices, businesses that are open and honest build stronger relationships with their audience.

It's Really All About Culture!

Culture is the feeling people have when they turn up to work. It’s the alignment of what we believe to be true. If culture is the house, then values are the concrete foundation.

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Businesses that live and breathe their values are more likely to achieve their goals and enjoy the journey. Think about your team—are your values truly guiding your actions? To know more about culture, check out my other blog on Why Organisational Culture and Business Values Matter for Success.

Values Don’t Just Sit on a Wall; They Become the Way You Lead

If you have values, but no one lives them, or worse, the team actively works against them, as we saw in our example with ABC Widgets, then these words are sadly just lip service and devalue the reason for having values in the first place.

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A values-based business embeds values as a living, breathing part of every single moment of the workday, making your leadership less conflicting and, frankly more straightforward.

Why Business Coaches Emphasise Values

As a small business coach, I’ve seen how clear expectations make leadership easier. Being clear about your business standards is kind and gives your team the best opportunity to excel.

“Clear is kind, unclear is unkind.” Brene Brown

Leadership is challenging, but having a playbook of what’s acceptable makes calling people to account much less emotionally draining. By defining success from the start, reinforcing it is just easier giving you greater ease and grace as you go on your business journey.

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If you want to create or refresh your organisational values, I’d love to help! I offer a two-month values programme tailored for small businesses. Let’s chat and see if we’re a match!

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